CHINA: PMI Services Moderates Again
- After declining in October, the RatingDog PMI Services fell again in November.
- November's reading takes the index to mid-year levels.
- Within the release some positives were an uptick in employment to 49.2 from 49, yet remains in contraction for the fourth consecutive month.
- Prices charged were up relative to last month.
- When coupled with the RatingDog PMI Manufacturing, the PMI Composite fell to 51.2, the lowest since July.
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CHINA: Rating Dog Manufacturing PMI Moderates
- The September expansion of the RatingDog PMI manufacturing seemed to reflect a period of expansion ahead of the Xi Trump meeting.
- Whilst today's release for the October data will not capture the impact of the meeting, it is more reflective of the type of expansion that is occurring we think.
- Up +50.6 in October it is a significant decline from the +51.2 in September, but importantly is the third month in a row of expansion.
- Output declined to +50.8 from 52.0 and new orders declined from the month prior.
MNI: CHINA OCT RATINGDOG MANUFACTURING PMI 50.6 VS 51.2 IN SEP
- CHINA OCT RATINGDOG MANUFACTURING PMI 50.6 VS 51.2 IN SEP
AUSTRALIA DATA: Ex Alcohol & Tobacco, Q3 Consumer Spending Robust
September household spending was softer than expected rising 0.2% m/m to be up 5.1% y/y after a downwardly-revised 4.9% y/y. Q3 consumption volumes rose 0.2% q/q, the lowest rate since Q3 2024 but the fifth consecutive quarterly rise. Growth continued to recover rising 2.7% y/y, the highest since Q1 2024 but pressured by contracting alcohol & tobacco expenditure. The data point to a continued gradual recovery in private consumption. While the RBA is widely expected to be on hold this week, its consumption forecasts will be monitored for upward revisions.
Australia real household consumption y/y%
Source: MNI - Market News/ABS
- In September, the RBA was uncertain if “households have become more comfortable consuming as real incomes and wealth rise”. The Q3 data are consistent with a consumer recovery and excluding alcohol & tobacco (-6.8% q/q) were a lot stronger than the headline.
- There was strong real consumption of food (+1.1% q/q), clothing & footwear (+0.8%), health (+1.8%) and miscellaneous goods & services (+1.2%). Recreation fell 0.5% q/q following strong growth in the previous three quarters and transport was flat. Household items rose 0.4% q/q, the fourth straight positive quarter.
- September nominal spending was driven by essential items, suggesting that consumers were reluctant to spend on discretionary items, especially if discounts aren’t offered. Non-discretionary rose 0.6% m/m to be up 6.2% y/y after 5.6% in August, whereas discretionary was flat to be steady at 4.5% y/y.
- Services spending was flat in September after rising solidly earlier in the quarter. It is now up 7.2% y/y down from 7.9% y/y. However, goods expenditure rose 0.4% m/m to be up 3.4% y/y after 2.4%.
Australia household consumption values y/y%
Source: MNI - Market News/ABS
